Global Innovation Catalyst, an advisory services firm connecting countries in the AMENA (Asia, Middle East and North Africa) region is to provide over 10 million innovative job drives in the world by providing the resources needed to stimulate job creation, high-tech entrepreneurship, and innovation-focused economic growth.
The company plans to provide five million innovative job drives for Africa which half a million goes to Ethiopia’s innovation efforts, which means about 10 percent of Africa’s allocation.
Kamrhan Elhan, founder and CEO of Silicon Valley based Global Innovation Catalyst, met with Getahun Mekria, Ministry of Innovation in Addis on May 22 to discuss the issue of supporting Ethiopian innovation.
According to the founder and CEO of the company, Global Innovation Catalysts provide the finance and training supports that were designed to be implemented globally for the next 10 years.
“Ethiopia gets the highest share from this initiative to get training and financial support for half a million youth,” Elhan said.
“The opportunities will be given primarily for university graduates to engage in tech based employment opportunities,” said Getahun.
The company is closely working with the UN, World Bank Group and universities to create tech based job opportunities worldwide.
The initiatives should begin next Ethiopian New Year in collaboration with Stanford University.
Many partners such as the UN show their support for Ethiopia’s effort in innovation and technology by providing technical, knowledge, as well as advisory support.
Ethiopia is the 122nd most competitive nation in the world out of 140 countries ranked in the 2018 edition of the Global Competitiveness Report published by the World Economic Forum, which measures the capacity of a country to innovate, including education and infrastructure, and the outputs of the economy in terms of scientific and creative output. Competitiveness Rank in Ethiopia averaged 118.33 from 2007 until 2018, reaching an all time high of 127 in 2014 and a record low of 106 in 2012.
Global Innovation Catalyst wants half a million job opportunities for Ethiopians
EIC Launches Online Services Platform, Chinese Web-Portal
The Ethiopian Investment Commission (EIC) has launched an online services platform where investors can apply for new investment permit and its renewal.
The platform also enables online administration of investment incentives.
The Commission has also launched a Chinese web-portal that is intended to provide up-to-date information to Chinese investors.
Foreign companies contribute to black market money spike
The black market versus the bank rate margin is now over 42%
More and more foreign companies are now using the black market causing the price of foreign currency to rise even higher and the difference between the legal exchange rate at banks and the black market to be over 42 percent. According to sources the rate changes every day on the black market. The current estimation is close to 40 birr per USD while it is about 28 birr at banks. One British Pound is 50 birr and one Euro is 45 birr.
In the past year for some time illegal foreign currency market rates went down closer to bank prices. Over the last few months they resembled a roller coaster but during the last couple of weeks they have skyrocketed again and now are much more different than the legal market. Sources say that this is happening because there are many foreign companies investing in Ethiopia but not registered at the international level, attempting to obtain foreign currency.
These people said that at present, foreign industries investing in Ethiopia are dominant players in the black market. They often are producing just as much as local investors but have better access to hard currency through the suppliers’ credit scheme to import inputs than similar but locally owned businesses.
Experts explained that currently foreign companies are able to manage huge liquidity since their business is the dominant player in terms of production throughout the year and they have a lower production cost than those who get a smaller portion of LC for their businesses.
“This allows foreign companies to amass a huge liquidity,” an expert who follows the industry sector explained.
Experts said that these investors should wait a long period to wire their foreign currency via banks to their home country since the country is in hard currency crunch.
“The growing liquidity by getting special access to foreign currency for their production and at the same time the shortage of hard currency to transfer their revenue to their home country has pressured investors mainly coming from Asian countries to be major players in the black market,” experts that worked with foreign investors explained.
They said that sometimes the investor collects the foreign currency locally but mainly focuses on the remittances sent by diaspora for family here.
The long waiting at banks to transfer their money to home countries pushes foreign investors to become a major player in the illegal currency market, a sales person working with foreign company told Capital. “They are collecting the foreign currency illegally here,” he added. He expressed his speculation that the current increase in the rate of the parallel market may be related with this new and growing demand.
Experts said that the suppliers’ credit scheme has created a vicious circle effect on the market. “Initially foreign companies secured hard currency through the scheme. However, other local investors and at the same time the extraordinary surplus reacting to the imbalance of LC disbursement has increased profit of foreign companies and liquidity pushing them to get foreign currency as soon as possible to wire to their home country,” experts explained.
Currently the government via the Ministry of Revenue and security apparatuses is trying its best to stop illegal foreign currency flow out of the country. It has seized a significant amount of foreign currency from smugglers including foreigners mainly those coming from Asia. Experts stated that it would be difficult to fully control the illegal remittance system, which requires the involvement of third party or country.
Bank process delaying medicine deliveries
The Ethiopian Pharmaceuticals Supply Agency (EPSA), an institution providing pharmaceuticals, laboratory reagents, medical equipment and supplies is saying banking procedures are delaying getting medicine to public.
Officials of EPSA said this while presenting their nine month performance report to the parliament in mid week.
EPSA has blamed the Commercial Bank of Ethiopia’s procedures for over 300 containers of medicine and medical equipment languishing at Modjo Dry Port. The agency opened a letter of credit (LC) at the Commercial Bank of Ethiopia months ahead to ease the process of procurement and deliver the medicines on time.
According to Goitom Gigar, Deputy Director of the Pharmaceuticals Fund and Supply Agency, the containers have stayed for months at Modjo Dry Port which has an impact on the shelf time of the medicine. They are asking CBE to provide the service with copies.
The time taken at the dry port incurs extra cost, like demurrage expenses in which the agency is obliged to add on the medicines’ cost, Goitom said.
The agency said the bank is not processing payments on time to suppliers of the drug, leaving the medicines and medical equipment at the dry port to stay a long time which sometimes creates shortage of medicines.
EPSA officials urge law makers to push government officials to create an effective system, which will avail payment of documents to the agency’s medicine and medical equipment suppliers on time.
“We need the bank to release the money budgeted for medicine procurement at the right time and free the containers,” he said, adding, it is due to the inconvenience, that “we face medicine shortages at times”.
“Although the agency has a formal agreement with CBE to avail a specified amount of money in a specific period, the bank is not providing the documents showing the release of that money on time,” said Goitom.
In addition to CBE’s bureaucratic producers, the agency is paying demurrage costs for the containers holding medicines, which, he said, is not the case in other countries.
According to the officials of the agency, the supply rate of pharmaceuticals has risen from 72 percent to 95 percent in 12 hospitals in Addis chosen for the program. And EPSA has imported medicines and medical equipment worth 10 billon birr in this fiscal year.
According to the officials, the agency is working hard to meet the demand of medicines throughout the country and confirm the availabilities of all medicines in the country.
